Louisiana House Bill HCR76

Louisiana 2020 Regular Session

• Introduced: 5/7/20
• Refer: 5/7/20
• Report Pass: 5/13/20
• Engrossed: 5/19/20
• Refer: 5/20/20
• Report Pass: 5/21/20
• Passed: 5/26/20

Caption

Urges and requests that any proclamation convening an extraordinary session of the legislature in 2020 include changes to the carryback provisions of the corporate income tax deduction for net operating losses

Impact

The proposed changes to the state corporate income tax deduction are intended to ease the financial burdens on businesses by allowing them to apply net operating losses from previous years against profits in earlier years. This modification is anticipated to improve cash flow for struggling businesses, enabling them to stabilize sooner. Such legislative action is seen as vital for preserving jobs and supporting economic recovery in Louisiana, especially as many businesses have faced closures or reduced operations due to health mandates related to the pandemic.

Summary

HCR76 is a concurrent resolution that urges and requests changes to the carryback provisions of the corporate income tax deduction for net operating losses to align with the federal guidelines set forth in the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). The resolution is a response to the significant economic hardship faced by businesses in Louisiana due to the COVID-19 pandemic, which has disrupted operations and led to widespread financial difficulties. By mirroring the federal provisions, the resolution aims to facilitate quicker financial recovery for Louisiana businesses impacted by the pandemic.

Sentiment

The sentiment around HCR76 generally reflects a recognition of the economic challenges posed by the pandemic, leading to bipartisan support for measures that assist businesses. Lawmakers express a sense of urgency regarding the need for financial support mechanisms, recognizing that without interventions like those proposed in HCR76, many businesses could fail. However, the resolution's effectiveness will depend on its adoption and implementation within the broader legislative context of the state's fiscal policy.

Contention

While HCR76 presents a solution for aiding businesses, there may be implications concerning state revenue and the balance of tax policy. Critics could argue that while aiding businesses is essential, it is equally important to ensure that the state retains adequate revenue streams to support public services. The debate could center on the broader impacts of extending tax provisions during a time of crisis, balancing economic relief against fiscal responsibility.